Lithium Carbonate Prices Soar 90%, Delivering Windfall to Salt Lake Lithium Extraction

The price of lithium carbonate continues to hit new annual highs, impacting the entire lithium battery industry. In December, the most-traded lithium carbonate contract on the Guangzhou Futures Exchange successively broke through the key levels of 100,000 yuan/mt and 110,000 yuan/mt. On December 23, the contract charged towards the 120,000 yuan/mt mark. To date, the lithium carbonate futures price has accumulated an increase of over 90% compared to the annual low of 58,000 yuan/mt.

"This round of lithium carbonate price increase is driven by the resonance of high expectations on the demand side and market sentiment," according to industry analysis. The unexpectedly strong performance in the downstream ESS sector, steady growth in the NEV market, coupled with the expansion of lithium battery applications into areas such as low-altitude flight and smart robots, collectively support the continuous release of lithium carbonate demand.

Supply side, major lithium chemical producers are maintaining high operating rates, with capacity utilization rates continuously improving. Industry insiders point out that the cost of salt lake lithium extraction, at 30,000-40,000 yuan/mt, is significantly lower than the processing cost of imported spodumene concentrates (60,000-80,000 yuan/mt). This gives salt lake lithium extraction producers significant cost advantages during the price rise cycle, enabling higher profit margins.

Industry data shows that China's lithium carbonate production in 2024 was approximately 700,000 mt, with salt lake lithium extraction accounting for about 17.7%. The rising lithium carbonate price will bring richer cash flow to salt lake lithium extraction enterprises, supporting further technological R&D and capacity expansion. According to industry forecasts, domestic lithium carbonate production is expected to reach 920,000 mt in 2025, with salt lake lithium extraction production growing by over 30%.

• Accelerated Capacity Release

With the rapid development of China's lithium battery industry, demand for lithium materials continues to grow. Lithium resources mainly consist of three types: spodumene mines, salt lakes, and lepidolite mines. Salt lake lithium extraction is a key technology for producing lithium carbonate or lithium hydroxide from brine rich in lithium element. For China, salt lake lithium resources are the most abundant, accounting for over 70% of the country's total lithium resources, making it a crucial path to secure lithium supply for the domestic lithium battery industry.

China's salt lake resources are mainly concentrated in Xizang, Qinghai, and Xinjiang region. Currently, lithium extraction projects in Qinghai's salt lakes are progressing relatively quickly, with a constructed capacity of 160,000 mt/year and a planned capacity of 220,000 mt/year. Although Xizang's salt lakes have superior resource endowment – for instance, the Zabuye Salt Lake is carbonate-type allowing direct extraction via solar evaporation – development progress is relatively slow due to factors such as the harsh local natural environment, and insufficient transportation and infrastructure conditions.

Since 2025, the commissioning progress of salt lake lithium extraction projects in China has noticeably accelerated. for example, QingHai Salt Lake Industry's 40,000 mt integrated lithium chemicals project, Zijin Mining's Lakkor Tso project, and Qinghai Huixin's 20,000 mt project have been successively brought online.
QingHai Salt Lake Industry stated that it plans to produce 43,000 mt of lithium carbonate in 2025. Its 40,000 mt lithium chemicals project was officially commissioned at the end of September this year, bringing the company's total lithium carbonate capacity to 80,000 mt.

Additionally, after receiving project approval in June this year, Zangge Mining's 50,000 mt/year lithium carbonate project commenced full-scale construction in Q3 and is expected to reach full capacity in 2026.

Industry analysis indicates that with the gradual release of new capacity, salt lake lithium carbonate production will maintain rapid growth in 2026, becoming a major growth driver for domestic lithium resource supply.

• Building China's Competitive Advantage in Lithium Chemicals

Against the backdrop of the accelerating global energy transition, lithium resources, as a key support for achieving the "dual carbon" goals, are seeing their strategic value become increasingly prominent. Industry analysis suggests that China's salt lake lithium extraction industry, leveraging technological iteration and economies of scale, is gradually building an industrial ecosystem with significant cost advantages and deep technological barriers, capable of providing stable and reliable lithium material supply for the new energy battery industry.

Salt lake lithium extraction boasts obvious cost advantages. Taking Zangge Mining as an example, its lithium carbonate business achieved revenue of 1.022 billion yuan in 2024, with sales of 113,600 mt. The average selling price (tax-inclusive) of its lithium carbonate was 85,000 yuan/mt, while the average sales cost was 41,000 yuan/mt, resulting in a gross profit margin as high as 45.44%.

In the field of salt lake lithium extraction technology, Chinese enterprises are building core competitiveness through differentiated innovation.

According to Zangge Mining, addressing the natural characteristics of Qinghai's salt lake brine – high Mg/Li ratio and low lithium concentration – the company's "adsorption plus membrane method" combined with "one-step lithium precipitation" technology can directly purify battery-grade lithium carbonate from ultra-low concentration brine, with a purity exceeding 99.5%, thereby achieving a significant improvement in resource utilization rate.

As one of the few Chinese providers mastering the "adsorption + membrane" full-process technology, Jiuwu Hi-Tech has undertaken multiple large-scale salt lake lithium extraction projects, accumulating comprehensive experience from core material R&D to project operation. QingHai Salt Lake Industry has made a breakthrough in "direct lithium extraction technology from Qarhan Salt Lake brine," successfully meeting core indicators such as the magnesium-lithium separation factor, verifying the feasibility of the technical route and laying the foundation for building a self-controlled industrial ecosystem.

In the future, with continuous breakthroughs in core areas such as adsorption materials and membrane separation technology, and the deepening of industrial synergy involving "technology + resources + capital," China's salt lake lithium extraction industry will not only provide a "Chinese solution" for global lithium supply but also contribute to national energy security and green development.

Please note that this news is sourced from http://www.cbea.com/djgc/202512/120553.html and translated by SMM.